How does Fulfilment by Amazon work?

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Fulfillment By Amazon is a real differentiator for Amazon that no other e-commerce platform offers. And there are so many ways that sellers can benefit from the Amazon fulfillment platform, including linking into your own website, so you can have the back end of your Shopify website straight into Amazon.

Amazon in the United States has over 90 warehouses, each the size of about 58 rugby fields. Amazon will distribute your product out to their appropriate warehouses and ship to the end customer. Their algorithm and machine learning model means they get their distribution prediction pretty much bang on and fulfill to your customers quickly and cost effectively.

Amazon storage is pretty cost-effective. It’s based on volume and weight. In their wisdom, Amazon will crank up warehousing cost in November and December as they manage the Q4 influx of Christmas so you’ve got to be aware of that and manage your inventory well.

Ultimately, they are distribution warehouses, they’re not storage warehouses, so Amazon don’t like you having more than three months’ worth of supply there. Hold stock in their distribution warehouse for over 6 or 12 months then expect a bill.

Once the buyer had purchased your product, Amazon will distribute from the nearest distribution centre. Picked and packed by a robot or a person, it gets sent out the door with either UPS or FedEx who deliver to the customers front door. All of the service delivery and customer experience is managed by Amazon. You get charged a fee per unit for this service and that fee takes into consideration the size and weight of your product.

Compared to other distribution models, FBA is a pretty fair deal and lets you concentrate on all the other facets of your business.

If you would like to find out more about distribution and warehousing options for your eCommerce channel then contact us here at Sell Global